The price of coffee has increased, yet evidence suggests the demand for coffee has been stable. A possible explanation is that:
A) there has been no change in the supply of coffee.
B) there has been increased use of subsidies in coffee production.
C) wages of workers in coffee production might have decreased.
D) wages of workers in coffee production might have increased.

Question

Quizplus · Accepted Answer

An increase in wages of workers in coffee production would increase production costs, leading to a higher price of coffee, while demand remains stable.

The Price of Coffee Has Increased, Yet Evidence Suggests the Demand